EasyJet rejects takeover approach from rival Wizz Air

EasyJet has rejected a takeover approach from rival Wizz Air, as the Hungarian carrier pursues an aggressive expansion into western Europe to take advantage of the worst crisis in the history of aviation. Luton-based easyJet said on Thursday that it had received an approach in a “low premium and highly conditional” all-share deal, which the board “had no hesitation in rejecting”. The unsolicited approach was from Wizz Air, according to a person briefed on the matter. Despite rejecting the approach, easyJet’s leadership believes consolidation in the airline industry following the pandemic is inevitable, said a different person familiar with the situation. The company refuses to rule out M&A in the future, indicating it might become a target or an acquirer, this person added. The group revealed the approach as it announced a GBP1.2b rights issue to help it through the crisis, which is set to dilute the influence of founder and largest shareholder Sir Stelios Haji-Ioannou. Haji-Ioannou is unlikely to participate in the equity raise, which means his 25% stake will be diluted, according to a person close to the businessman. With the company’s stock at half its pre-pandemic price, the offer, which was made in the past few weeks, “significantly undervalued” the group, said CE Johan Lundgren. The carrier is no longer considering an offer, he added, stressing his confidence that easyJet can grow as the industry starts to recover from the pandemic.<br/>